What risk percentage per trade keeps my risk of ruin below a target percentage?
Enter Your Numbers
Your Result
Fill in your win rate and a target risk of ruin, then click Calculate to see the maximum risk per trade that keeps you under it.
How this is calculated
This uses the same simplified "gambler's ruin" model as our Risk of Ruin Calculator, solved in reverse: instead of finding risk of ruin from a chosen risk per trade, this finds the risk per trade that produces your target risk of ruin.
Edge equals (2 × your win rate) minus 1. Units of risk equal 100 divided by risk per trade. Risk of ruin equals ((1 − edge) ÷ (1 + edge)) raised to the power of units of risk.
The model assumes a 1:1 risk-to-reward ratio, a fixed percentage risked every trade, independent trade outcomes, and an indefinitely long series of trades. A favorable risk/reward ratio, where your average winner beats your average loser, lowers your true risk of ruin below what this simplified model shows.
If your win rate is 50% or below, this model shows 100% risk of ruin no matter how small your risk per trade is. Position sizing alone cannot fix a system with no edge under this 1:1 assumption.
Treat the result as a theoretical ceiling, not a recommendation. Trading anywhere close to this maximum means accepting far more balance swings than most traders find comfortable in practice.
Risk & liability disclaimer: This calculator produces a mathematical estimate from a simplified model based on the numbers you enter. It is not financial advice and does not guarantee any trading outcome. The underlying model assumes a 1:1 risk-to-reward ratio and independent trade outcomes, which is rarely exactly true in practice. Trading involves risk of loss, and past performance does not predict future results. Trading Habits is not a broker-dealer, registered investment adviser, or tax professional, and is not affiliated with any broker, exchange, or data provider. Always verify results independently and consult a licensed professional before making any trading or financial decision. You could lose some or all of the capital you trade with.
Size Before You Risk of Ruin, Not After
More Trading Tools
Pair this with the tools below to turn a safe ceiling into an actual working risk-per-trade number.